Paul O Mahoney
Registered User
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No.Sorry lads, but if the shares were sold would they be subject to CGT too?
It was termed a "special dividend " where 8 Pfe shares held received 1 Viatris share.No.
If it was a special dividend, then the value becomes your base cost for future CGT.
Where did you get confirmation that it was treated as a special dividend for tax purposes? Was it not a spin off, so your cost basis for Pfizer changes?
Was it not a special distribution?It was termed a "special dividend " where 8 Pfe shares held received 1 Viatris share.
Yes, and you have mentioned the structure being a non tax event, but my concern is that there has been a financial gain , the shares owned have purchase costs that I have recorded in detail including fx rate.Was it not a special distribution?
This was structured in such a way that it wasn't a tax event in the US, so I'm surprised that it was a dividend.
This is the Upjohn / Viatris spinoff you're referring to?
Again thank you, I initially viewed it as a stock split but I have discounted that, as they generally don't generate new shares in new entities.It's a bit complex, and I don't have the exact details. My simple understanding is as below:
Let's say you originally bought the shares for 100 each. In 2020 for every 10 shares held, you received 1 share in new company. To keep things simple, on the date you received shares they all had the same price.
Instead of you old shares base cost being 100, it's now 90.90, and the base cost for the new share is also 90.90. (90.90*11 = 100*10, so your total base cost hasn't changed, its just been allocated differently). I've definitely seen a calculation of the base costs worked out in detail somewhere.
So if you sell any in future, your starting price is different to what you originally paid.
That'd also explain why the RUSs etc were adjusted.
Ohhh perhaps that's my confusion.Was it not a special distribution?
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